Find the best AUD/GBP exchange rate and avoid transaction fees when you transfer money from Australia to the UK.
When you need to send money back home to the UK from Australia, it’s crucial that you find the best AUD/GBP exchange rate. By timing your transaction when the AUD/GBP exchange rate is at its highest, you can enjoy the best value for money. And if you compare money transfer providers before making your transaction, you’ll be able to lock in the highest rate available and avoid costly transfer fees.
But how do you know when it’s the best time to send money from Australia to the UK? Read on to find out.
Compare AUD/GBP money transfer exchange rates below
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AUD/GBP: How to get value for money
There are two issues you need to take into account when sending money from Australia to the UK:
- Timing your transfer so you can take advantage of a high AUD/GBP exchange rate
- Choosing a money transfer provider that offers the best AUD/GBP exchange rate and low transfer fees
To kick things off, let’s look back at the history of the AUD/GBP exchange rate to find out how you can pick and choose the best times to send money to the UK.
Australian dollar to British pound exchange rate history
Introduced in 1966, the Australian dollar (AUD) was originally a fixed currency, pegged directly to the US dollar (USD). Following short periods as a managed floating currency and then being pegged to the British pound sterling (GBP), the AUD became a free-floating currency at the end of 1983.
The GBP and the AUD respectively represent the fourth- and fifth-most traded currencies in the world, but it’s the GBP which has always performed stronger against its younger rival. Since its introduction, the AUD has consistently traded at a much lower value than the GBP. Across the past 10 years, the dollar has traded at a low of £0.38 in October of 2008 and a high of £0.69 in March 2013.
Australia’s much-publicised mining boom, which was fuelled by China’s strong growth, led to a strong Australian economy during times when other countries were reeling from the global financial crisis of 2008. However, by the time the AUD experienced its strongest performance against the GBP in 2013, the growth rate of the Australian economy had begun to slow.
The AUD weakened against several major global currencies in 2015, trading around the £0.46 to £0.47 mark during October 2015, but was to see an upsurge in value relative to the GBP following the results of the Brexit vote in June 2016. As the value of the GBP plummeted following the decision to leave Europe, the AUD steadily increased to trade around the £0.62 to £0.63 mark in November 2016.
When can I find the best AUD/GBP exchange rate?
The value of a country’s currency fluctuates all the time, as you can see by looking at a 10-year graph of the AUD/GBP exchange rate history. With this in mind, it’s essential to transfer money from Australia to the UK when the exchange rate is at its peak, as this allows you to get the best value for money.
For example, let’s say you wanted to exchange your AUD for GBP in May 2016, when 1 AUD was worth 0.49 GBP. Just a couple of months later in July, the AUD/GBP exchange rate had risen to 1 AUD = 0.58 GBP. As the table below shows, by waiting two months to send your international money transfer, you could have received a much better deal. To further demonstrate the point, sending the transfer in late October, when the AUD was trading at 0.63 GBP, would have provided even better value
|May 2016||July 2016||October 2016|
|Transfer amount (in AUD)||$1,000||$1,000||$1,000|
|Exchange rate||1 AUD = 0.49 GBP||1 AUD = 0.58 GBP||1 AUD = 0.63 GBP|
|Amount received (in GBP)||£490||£580||£630|
By sending a transfer in October rather than May, you could have sent an extra £140 back home to the UK – without paying an extra cent of Australian currency.
How do I know when to transfer AUD to GBP?
The best time to send money from Australia to the UK is when the AUD is at peak value compared to the GBP. However, working out the future performance of an exchange rate can be very difficult. There are many influencing factors that can affect the value of one currency versus another, including interest rates, inflation, political changes (such as the Brexit vote) and consumer sentiment in each country.
As a result, there’s no easy way to predict what course the AUD/GBP exchange rate will take. However, you should definitely monitor financial news to gain impressions of a country’s economic performance and the strength of its currency, plus stay abreast of reports from financial experts predicting future changes to exchange rates. Looking back at the history of the AUD/GBP exchange rate could also help you develop an understanding of when one currency is overvalued relative to another.
The best time to transfer AUD to GBP is whenever the AUD is strong compared to the GBP. In other words, you want to send a transfer whenever your Aussie dollars will purchase as many pounds as possible.
As the graph below shows, the best times to transfer money from Australia to the UK in the year leading up to 16/11/2016 were:
- In July 2016, when 1 AUD = 0.58 GBP
- In August 2016, when 1 AUD = 0.59 GBP
- In October 2016, when 1 AUD = 0.63 GBP
*Screenshot taken from xe.com, 16/11/2016
Choosing the right transfer provider
Choosing the right time to send your international money transfer isn’t the only thing you need to do to ensure the best exchange rates; you will also need to compare a range of money transfer providers to find one that offers the winning combination of high exchange rates and low fees.
There are three main options when sending an international money transfer from Australia to the UK:
You can send money directly from your Australian bank account to an account in the UK.
Cash pickup transfer providers
Online transfer providers
Even if you choose the perfect time to transfer funds and the AUD/GBP exchange rate is at its peak, you can still lose out if you accept a low rate. Most money transfer providers make money on the margin, which is the difference between the mid-market exchange rate and the rate they offer to their customers.
As a result, the exchange rates on offer can vary greatly from one provider to the next. For example, banks tend to provide much lower exchange rates than online transfer companies, so choosing the wrong transfer option could cost you hundreds of dollars.
Specialist transfer providers also charge lower transfer fees than the major banks when you send money overseas. There are some providers that will even waive their fees completely if you transfer a large amount, so it’s definitely worth comparing your options and shopping around.
Dave is spending a couple of years living and working in Australia, but he regularly sends money back home to England to support his ageing parents. In the past he has transferred the funds directly from his “Big Four” bank account, but he decides to compare his options to see if he can find a better deal. He compares the exchange rates and fees for sending AUD$1,000 to GBP with a bank, a cash transfer company and a money transfer provider.
|Bank||Cash transfer company||Online transfer company|
|Exchange rate||1 AUD = 0.5734 GBP||1 AUD = 0.5772 GBP||1 AUD = 0.6062 GBP|
|Transfer method||Bank transfer||Cash pickup||Online transfer|
|Processing time||2–5 days||10 minutes||2 days|
|Amount sent (in AUD)||$1,000||$1,000||$1,000|
|Amount received (in GBP)||£570.34||£577.20||£601.98|
As you can see, even though the difference in exchange rates doesn’t seem all that large, using a specialist online transfer provider allows you to send more than £30 extra than if you use a bank, or more than £24 extra than if you use a cash transfer provider. It’s also important to note that you can also save $15 (vs a bank) or $13 (vs a cash transfer company) on fees by using the online transfer provider.
This shows just how crucial it is to compare money transfer providers before you send money from Australia to the UK. Find a detailed breakdown of how to compare money transfer companies in our guide to international money transfers.
Other tips to help you get the best AUD/GBP exchange rate
There are plenty of other steps you can take to ensure that you find the best AUD/GBP exchange rate for your next international money transfer:
Monitor the current rate
With the help of trusted currency conversion websites like XE and Oanda, you can stay abreast of the current mid-market AUD/GBP rate. Compare this rate to the exchange rates on offer from money transfer providers to determine whether you are getting value for money.
The exchange rate quoted on the homepage of some money transfer providers or on their online calculators is the interbank rate – not the rate they offer to customers. To find out what exchange rate will actually apply to your transaction, fill out the info required to obtain a quote and then compare quotes between providers.
Use forward contracts
A forward contract allows you to lock in an attractive exchange rate now for a transaction that will take place at some stage in the future, possibly even years in advance. This makes it possible to protect yourself against falling exchange rates, but not all money transfer companies offer forward contracts as an option.
Use limit orders
Limit orders are another flexible transfer tool that allow you to lock in a good rate and also save time. When you place a limit order you choose the exchange rate you want and enter the details of your transfer, and that transfer will be automatically sent when the exchange rate you want becomes available.
Send big transfers
There are a couple of reasons why sending one big transfer instead of several smaller transactions can save you money. First, this will mean that you only pay one transfer fee instead of multiple fees. Second, some providers will waive their fees altogether on large transfer amounts.